Global Student Loan Repayment

source: http://www.mining

The top nations in education have seen their numbers of students increasing annually, yet the current student loan debt in the U.S is 1.4 trillion dollars.  Susan Dynarski a professor of education, public policy and economics at the University of Michigan, explores the repayment systems in other countries and compares them to the system here in the U.S.  Her article published in the New York Times, titled “America Can Fix Its Student Loan Crisis. Just Ask Australia”, provides a variety of efficient systems implemented around the world, this establishes her credibility because she avoids merely provide evidence for one side of the argument. The institutions around the globe have repayment systems that differ from the U.S and from one another.  This is seen in Australia and England, as they have similar repayment systems, even Germany and Sweden have systems that have been influenced by their economy and culture.

Students in Australia borrow the similar amounts of money as Americans(30,000 Australian dollars, or about $22,000). Their system works efficiently because students who borrow money are not due to being their repayment until their income reaches $40,000.  In  Australia even the payment due is adjustable.  If you income rises, or falls you can expect the payment to follow.   This is called payroll withholding-in the U.S it is the way we pay for Social Security.  A similar system is employed in England,.  The price you pay is income based and after 30 years all loans are forgiven.  While these systems are efficient in those places, it is It also essential to weigh the costs in implementing a system like these.

Universities in Germany and Sweden do not have tuition. These countries still have a version of student loans  While they do not pay for tuition, students do in fact pay for the cost of living. In Germany, the 82% of the students graduate debt free, and when compared to the U.S their system appears exceptional. Sweden’s strong welfare system is primarily cheap in cost to keep the borrowers out of fault.  In return the generous prices are affordable by even people who are considered poorest. I think it is important to reemphasize how these systems specifically were influenced by the country's culture and economy. While in the U.S the system is in need of reform, I think it is essential to predict how our culture and economy will be impacted by these changes.